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Case Studies

The IRS says it has settled three cases under the IRS whistleblower law passed in 2006. Of those three cases, only one has been made public, and that case was settled for $20 million.

The whistleblower in that case was an in-house Certified Public Accountant and auditor who discovered a $20 million-plus tax liability at a large national financial services firm. The acountant reported the liabillity internally to his Fortune 500 company, but they declined to report the liability to the IRS, and ignored his admonitions to do so.

The whistleblower in this case filed IRS Form 211 with the new IRS Whistleblower Office without benefit of counsel, but after more than two years had passed, and no IRS response had been received despite numerous inquiries, the whistleblower contacted an experienced whistleblower attorney. That attorney discovered that the IRS had lost the original filing and, as a consequence, the whistleblower had never received a “Claims Number” for the original Form 211 filing. The whistleblower and his attorney resubmitted the original case documents and information to the IRS, and the attorney helped demonstrate to the IRS Whistleblower Office how instrumental the whistleblower had been in both making and advancing the case.

In the end, the whistleblower was awarded $4.5 million award for his assistance and information.

The Taxpayers Against Fraud Educational Fund is a nonprofit, public interest organization dedicated to combating fraud against the government and protecting public resources through public-private partnerships.